CITATION: A & A Trading Ltd. v. DIL’S Trucking Inc., 2015 ONSC 1887

COURT FILE NO.: CV-14-3373

DATE: 20150324

ONTARIO

SUPERIOR COURT OF JUSTICE

B E T W E E N:

A & A TRADING LTD.

M.L. Biggar, for the Plaintiff, the Moving Party

Plaintiff

• and -

DIL’S TRUCKING INC.

Heather Gray, for the Defendant, the Responding Party

Defendant

HEARD: March 17, 2015

RULING ON PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT

Justice Thomas A. Bielby

INTRODUCTION

1The plaintiff herein seeks summary judgment for the value of goods lost, together with costs on a substantial indemnity basis. The plaintiff hired the defendant to transport its goods from Toronto to Calgary. While in transit, the goods were stolen.

2The goods had a value of $263,520.00 and it is in this amount the plaintiff seeks judgment.

FACTS

3The plaintiff/consignor is in the import/export business. In mid-April 2004, Mr. Ashna Hamd, the owner of the plaintiff corporation contacted Mr. Dilbag Singh, the owner of the defendant corporation, by cell phone, seeking a quote for the delivery of a consignment of goods from Toronto to Calgary.

4Mr. Hamd advised Mr. Singh that the goods had a value of between $250,000.00 and $263,000.00 and asked Mr. Singh if the defendant had sufficient insurance. Mr Singh confirmed that there was sufficient insurance and Mr. Hamd then hired the defendant to deliver the consignment.

5On the day of shipment, April 25, 2014, Mr. Hamd filled out his own standard bill of lading for the consignment. He did not declare a value for the consignment on the face of the bill of lading. His practice was not to do so, but instead attached to the bill of lading a copy of an invoice number 140407 and a packing slip. The invoice showed the value of the consignment to be $263,520.00.

6These documents were handed to Mr. Jillani, an employee of the defendant who attended to pick up the consignment. Mr. Jillian also completed a bill of lading and on it referenced invoice number 140407. The defendant’s bill of lading was signed by both Mr. Jillani and Mr. Hamd and a copy was given to Mr. Hamd.

7On cross examination, Mr. Singh acknowledged that it was common sense and practice to incorporate, by reference on the bill of lading, information provided by the consignor rather than to re-write the same information on the bill of lading. It was the defendant’s practice to attach or include all documents provided by the consignor with the defendant’s bill of lading.

8On April 28, 2014, the consignment was stolen while in transit and in the possession of the defendant.

9On these facts, it is clear the defendant was aware of the value of the plaintiff’s consignment.

ISSUES

10The Highway Traffic Act R.S.O. 1990 Chapter H.B, section 191.0.1 states:

(1) Every contract of carriage for a person to carry the goods of another person by commercial motor vehicle for compensation shall contain the information required by the Regulations and shall be deemed to include the terms and conditions set out in the Regulations.

11The Ontario Regulation 643/05, section 4 sets out what must be contained in a contract for carriage. Schedule 1, section 1, of the Regulation, states:

The carrier of the goods described in this contract is liable for any loss of or damage to goods accepted by the carrier or the carrier’s agent except as provided in this schedule.

12Section 9 and10 of Schedule 1, in effect, limits the value of the loss to $4.41per kilogram unless the consignor, in this case, the plaintiff, has declared a value of the goods “on the face of the contract of carriage”.

13In this case, if the actual value has not been declared on the “face of the contract of carriage”, the plaintiff’s damages are limited to approximately $100,000.00, significantly less than the actual value of the goods, as noted above, $263,520.00.

14The issues to be determined are:

1. whether the issue can be determined by summary judgement motion or is there a genuine issue requiring a trial;

2. what is the contract of carriage; and

3. did the plaintiff, as consignor, declared the value of the consignment on the face of the contract of carriage.

ANALYSIS

Is There a Genuine Issue For Trial?

15Rule 20.01 of the Rules of Practice states the following:

(1) A plaintiff may, after the defendant has delivered a statement of defence or served a notice of motion, move with supporting affidavit material or other evidence for summary judgment on all or part of the claim in the statement of claim.

Rule 20.04 states as follows:

(2) The court shall grant summary judgment if,

(a) the court is satisfied that there is no genuine issue requiring a trial with respect to a claim or defence: or

(b) the parties agree to have all or part of the claim determined by a summary judgment and the court is satisfied that it is appropriate to grant summary judgment.

(2.1) In determining under clause (2) (a) whether there is a genuine issue requiring a trial, the court shall consider the evidence submitted by the parties and, if the determination is being made by a judge, the judge may exercise any of the following powers for the purpose, unless it is in the interest of justice that such powers to be exercised only at trial:

1. Weighing the evidence.

2. Evaluating the credibility of a deponent.

3. Drawing any reasonable inference from the evidence.

(2.2) A judge may, for the purposes of exercising any of the powers set out in subrule (2.1), order that oral evidence be presented by one or more parties, with or without time limits on its presentation.

16In Hyrniak v. Mauldin [2014] SCC 7, the Supreme Court of Canada laid out the analysis to be followed on a motion for summary judgment. First, the court should determine if there is a genuine issue requiring trial, based only on the evidence before the court, without using its fact-finding powers conferred upon the court in subrule 20.04(2.1).

17If the motion judge is able to reach a fair and just determination on the merits, there will be no genuine issue requiring a trial. This will occur when the process allows the judge to make the necessary findings of fact and to apply the law to the facts, and where the process offers a timely, affordable, and proportionate means to achieve a result (para. 66).

18It there appears to be a genuine issue requiring a trial, the court should determine if the need for a trial can be avoided by using the powers under subrule 20.04(2.1) and (2.2). The judge may use those powers at his/her discretion, provided that their use is not against the interests of justice (paras 66-68).

19In this matter, the facts, as I have set them out, are sufficient to make a fair and just determination of issues two and three and there is not a genuine issue requiring a trial.

CONTRACT FOR CARRIAGE

20Section 4 of Regulation 643/05 sets out what must be contained in a contract of carriage and one of the requirements is that the contract must contain a space to show the declared value of the shipment, if any. Another is that the contract must bear the signatures of both the carrier and the consignor (ss. (i) (q)).

21Neither the plaintiff’s nor the defendant’s bill of lading contained a space to declare value and only the bill of lading presented by the defendant contained both signatures.

22The Regulation does not, however, define a contract of carriage. Is it simply a bill of lading or is it something else or can it be made up of a number of documents?

23The Regulation does not expressly limit or equate a contract of carriage to a bill of lading.

24Can oral representations form part of the contract?

25In Fleet Express Lines Ltd. v. Continental Can Co. 1969 CanLII 409 (ON SC), [1969] 2 O.R. 97, the defendant agreed to deliver approximately two million cans to the plaintiff. Representatives of the parties had a least two conversations concerning the terms of shipment. At trial, the issue was whether a bill of lading constituted the entire contract between the parties under the Public Commercial Vehicles Act, and the accompanying Regulations.

26Addy J. stated, at page 4:

In each case the court must decide whether the parties have or have not reduced their agreement to the precise terms of an all-embracing written formula. If they have, oral evidence will not be admitted to vary or to contradict it; if they have not, the writing is but part of the contract and must be set side by side with the complementary oral terms. The question is at bottom one of intention and, like all such questions, elusive and conjectural.

27Addy J. goes on and makes reference to the decision in The Ardennes (Owner of Cargo) v. The Ardennes (Owners) [1950] 2 All E.R. 517 in which Chief Justice Lord Goddard held that the bill of lading was not the entire contract. On page 4, Addy J. quotes from pp. 519-20 of the Ardennes case which reads,

It is, I think, well settled that a bill of lading is not, in itself, the contract between the shipowner and the shipper of goods, though it has been said to be excellent evidence of its terms.

28Addy J. ruled that the real contract was the oral contract and that bills of lading were nothing more than receipts that contained information identifying the parties and the goods.

29At page 6, bottom paragraph, Addy J. wrote:

In my view, before any Court can find that the Legislature has abdicated its right to legislate in the field of contract between citizens, and to vary common law principles by delegating such powers to the Lieutenant-Governor in Council, the legislation purporting to do this must be absolutely clear and unequivocal. A power to prescribe the form or conditions which are to be included in the bill of lading is not a power to state what the implied conditions will be and what the rights between the contracting parties will be, if certain clauses are excluded from the bill of lading. If such is the meaning of the Regulation, then if I find that it exceeds the provisions of the Act and is invalid in so far as it purports to state that, if there is no specific endorsement of the bill of lading to the effect that there is a warranty as to time of delivery, no such condition can otherwise be agreed upon between the parties.

30The reasoning in Fleet was followed by the Federal Court of Canada in Tagish Kwan Corp. (Trustee of) v. R., 49 A.C.W.S. (3d) 680, where, at paragraph 35, the court said:

Where a written contract does not constitute a complete expression of the contractual arrangement between the two parties, then the Parol Evidence Rule does not apply and that part of the agreement which is oral may be proven by oral evidence: for example Fleet Express Lines Ltd. v. Continental Can Co. of Canada Ltd. (1969) 1969 CanLII 409 (ON SC), 4 D.L.R. (3d) 466.

31In Solway v. Davis Moving & Storage Inc., 2001 CanLII 28079 (aff’d on appeal 2002 CanLII 21736 (ON CA), 62 O.R. (3d) 522) the plaintiffs hired the defendant to move the contents of their home. The bill of lading signed by the plaintiffs on moving day limited the defendant’s liability to $.60 per pound, as per the Truck Transportation Act, R.S.O. 1990, c. T.22. The plaintiffs lost the contents when the truck was stolen. The plaintiffs sued for the loss of the contents, loss of income (they operated a business out of their home) and punitive damages.

32The plaintiffs relied on the fact that the defendant represented to them that their contents would be kept safe in a trailer, which would be in a fenced-in area with surveillance and with someone onsite 24 hours a day. The defendant relied on the limitation of liability clause in the bill of lading.

33After a review of the law, which included the Fleet Express case, the court concluded at paragraph 100:

It is the defendants who should bear those losses which were attributable to the breach of the contract between the parties. They cannot rely on a limitation of liability clause where it would be unreasonable to enforce it in the circumstances.

34The Court of Appeal upheld the trial judge’s decision on the basis that it would have been unconscionable in the circumstances of the case to enforce the limitation of liability clause in the bill of lading, particularly in light of the oral assurances by the defendants that their goods would be kept safe.

35The plaintiff submits that the oral representations of the defendant’s owner confirming there was insurance sufficient to cover the value of the consignment, being between $250,000.00 and $263,000.00 was relied upon by the plaintiff and is part of the contract.

36The plaintiff further submits that invoice number 140407 was part of the contract of carriage in that it was part of the documents given to the driver. Further, that the defendant’s driver noted on the front of the defendant’s bill of lading, the following: “Invoice # 140407” (Tab B of the motion record) and thereby incorporated the information in the invoice into the bill of lading.

37Counsel for the defendant submits, at paragraph 12 of her factum, that Mr. Hamd did not declare a value for the consignment on the face of his own bill of lading. Implicit in that submission is the suggestion that the bill of lading was the contract of carriage.

38I find that the contract of carriage is not limited to or equated to a bill of lading and, in that regard, rely on the authorities referenced.

39I find that the oral representation as to insurance, made by Mr. Singh, was relied upon by the plaintiff and is part of the contract of carriage and that was the intention of the parties. It was part of the shipping agreement between the parties. Without that representation, the plaintiff would have not hired the defendant to transport the consignment. The plaintiff wanted to be assured that the defendant has sufficient insurance to cover the value of his consignment.

40I also conclude that the contract of carriage included the bill of lading prepared by the defendant’s representative and signed by both parties. Also included in that contract was invoice number 140407 because it was noted on the bill of lading and a copy of the invoice provided by the plaintiff.

41I accept that it was the practice of the defendant, as expressed in his cross-examination, to refer to other documents on bills of lading, such as the invoice, to avoid writing all the terms. At page 40 of Mr. Singh’s cross-examination, when asked why the invoice number was recorded on his bill of lading he stated, “Because it is common sense in our industry to put that there if we do get it from the customer.” (line 171).

42At page 41-42 of Mr. Singh’s cross-examination, he discusses the inclusion of the invoice number on the bill of lading and states, “Yes, why re-write it, because you already have the info here.” (line 179).

43To rule otherwise would be unreasonable.

WAS THE VALUE OF THE GOODS DECLARED BY THE CONSIGNOR ON THE FACE OF THE CONTRACT OF CARRIAGE?

44As noted, a carrier is liable for any loss of the consignment (Reg. 643/05, Sch. 1, s. 1).

45Section 3 of the Regulation obligates a carrier to carry insurance for loss or damage to goods in an amount sufficient to cover the loss or damage of the goods carried.

46While, as noted previously, contract of carriage must include a space thereon for value of goods, the value of the goods are not required to be set out in and only in that space. The value of the goods is to be declared “on the face of the contract of carriage”.

47Specifically. Section 10 of the Regulation states:

If the consignor has declared a value of the goods on the face of the contract of carriage, the amount of any loss or damage for which the carrier is liable shall not exceed the declared value.

48Both parties attached to their bills of lading the invoice and/or a reference to the invoice number.

49The plaintiff argues and I accept that the legislative intent behind the requirement of the shipper to declare the value of the consignment on the face of the contract of carriage is to provide notice to the carrier of the value of the risk and to provide the carrier with the opportunity to decide whether to assume the risk (Anticosti Shipping Co. v. St. Amand 1959 CanLII 61 (SCC), [1959] S.C.R. 372, para. 8; Sept Iles Express Inc. v. Tremblay 1963 CanLII 1089 (CA EXC), [1964] Ex. C.R. 213, para. 13).

50The plaintiff submits that the defendant knew of the value of the consignment as a result of the oral communication and the inclusion of and/or reference to Invoice 140407.

51The plaintiff submits that the limitation of liability clause in section 9 of the Regulations should not apply in these circumstances on the grounds that the value of the consignment was included as part of the contract of carriage and that the defendant had full knowledge of the value.

52Counsel for the defendant submits that the onus was on the plaintiff as the consignor to declare the value of consignment on the face of the contract of carriage, specifically noting the value was not recorded on either bill of lading.

53It is submitted that the wording of the Regulation promotes and ensures predictability in transactions between shippers and carriers (Phoenix Bio-Tech Corp. v. Day & Ross Inc. (2003) 125 A.C.W.S. (3d) 529, para. 20).

54It is submitted that, as a result of the value not being recorded on the face of the bill of lading, the plaintiff’s right to recovery is limited to the lower value as set out in section 9 of the Regulation.

55Generally speaking, legal authority states that the failure of a consignor to declare the value on the face of a bill of lading will mean that the consignor must bear any loss in excess of that prescribed by s. 9 of the Regulation. This rule is discussed in the Supreme Court of Canada’s decision in Anticosti (supra).

56In Anticosti, the respondent recruited the carrier to have his truck shipped. The shipping clerk filled out the bill of lading but no value of the consignment was declared on it. The truck and consignment were subsequently damaged and the carrier relied on a limitation of liability clause in the Water Carriage of Goods Act, R.S.C. 1952, c. 291.

57At paragraph 10, the Court stated:

The responsibility for seeing that the value of the thing shipped is declared and inserted on the bill is on the shipper and any consequential hardship must be charged against his own failure to respect that requirement.

58What is not clear is whether the onus on the consignor applies notwithstanding the fact that the carrier has knowledge of the value of the consignment or that the carrier was provided with a document in which the value is declared. In Anticosti, the Supreme Court of Canada stated, in obiter, that the carrier’s limitation would continue to apply even where the carrier has knowledge of the value of the consignment (page 375).

59In Anticosti, the carrier was only informed of the shipper’s name, the article to be shipped, its make, weight and destination. Nothing in the decision suggests the carrier was aware of the value of the consignment.

60A rigid position is also taken in the Sept Iles decision(supra) which cited, with approval, the English case of Pendle and Rivet Ltd. v. Ellerman Lines Ltd. [1927] 33 Comm. Cas. 70 at 78, in which the court held that, notwithstanding the fact that a document indicating the value of the goods was sent to the carrier, the limitation of liability, under the British Carriage of Goods by Sea Act, applied.

61Corcoran v. Ehrlick Transport Ltd. et al, 1984 CanLII 2023 (ONCA) is a decision of the Ontario Court of Appeal. In that case, the plaintiff’s horse was killed by the negligence of the driver of the defendant transport company. The defendant relied on the limitation of liability contained in Schedule A to the Public Commercial Vehicles Act RSO 1970, c.375.

62Section 10 of that legislation limited liability to a formula amount unless a higher value is declared on the face of the bill of lading. Further, the bill of lading is to be signed by the consignor. A bill of lading was prepared which included the printed words showing the value of the horse as $1,000.00 but it was not signed by or even seen by the plaintiff, the consignor.

63At trial, the plaintiff recovered the full value of the horse on the ground that the bill of lading had not been issued to the plaintiff as required.

64The Ontario Court of Appeal dismissed the appeal ruling that the legislative scheme required the carrier to give the consignor the opportunity of declaring the true value of the goods. Since the bill had not been issued to the plaintiff, the defendant could not rely on the statutory limitation (headnote).

65While Corcoran did not mention the value of the horse to the defendant, the sales slip setting out the value was given to the defendant.

66Bills of lading were required to include a space where the value of the consigned goods could be included. While this space was not filled out, it was noted on the bill of lading under the heading “Description and Declared Value of Each Animal “$1,000.00.” The bill of lading was not signed by the plaintiff.

67The Appeal Court in Corcoran agreed with the trial judge’s finding that the carrier had not issued the bill of lading to the plaintiff before the loss and therefore the carrier could not benefit under the legislation. Without the carrier presenting the bill of lading to the consignor, thereby allowing him to sign the bill of lading and make a declaration of value, the result is that section 10 was inoperative.

68Continuing with Corcoran, the Court of Appeal distinguished the Anticosti decision on the basis of the different legislative regimes.

69It is important to distinguish these cases and the legislative schemes before them. The declaration of value was to be on the face of the bill of lading as distinct from contracts of carriage.

70In regards to the interpretation of statutes, Paragraph 87, in Driedger’s Construction of Statutes (2nd ed. 1830) page 87 as referenced and adopted by the Supreme Court of Canada in Rizzo v. Rizzo Shoes Ltd. 1998 CanLII 837 (SCC), 1998 CarswellOnt 1, paragraph 21, states:

Today there is only one principle or approach, namely, the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act and the intention of Parliament.

71The Interpretation Act R.S.O. 1990, c. 11, section 10 states:

Every Act shall be deemed to be remedial, whether its immediate purport is to direct the doing of any thing that the Legislature deems to be for the public good or to prevent of punish the doing of any thing that it deems to be contrary to the public good, and shall accordingly receive such fair, large and liberal construction and interpretation as well best ensure the attainment of the object of the Act according to its true intent, meaning and spirit.

72In the respondent’s factum, counsel discusses the meaning of the phrase, “on the face.” In Saskatoon Gallery and Conservatory Corp. v. Deakin Fine Art Transport 1985 CanLII 1990 (ONSC), Craig J., commencing at the bottom of page 8, discusses how the phrase is to be interpreted. He was assured by the counsel before him that there were no reported Canadian decisions dealing with the words, “on the fact of the bill of lading”.

73Craig J. noted that the bill of lading in issue before him was only one sheet of paper. He goes on to make reference to an American case, Cunningham v. Great Southern Life Ins. Co. 66 S.W. 2d 765, a decision of Justice Dunklin of the Court of Civil Appeals of Texas, who, at p. 773, stated:

In Webster’s New International Dictioinary the following are among the definitions of the noun “face”: The surface of anything; esp. the front, upper or outer part or surface; that which particularly offers itself to the view of the spectator.

Another definition given in 2 Bouv. Law Dict. 1175 is:

The outward appearance or aspect of a thing. The words of a written paper in their apparent or obvious meaning, as, the face of a note, bill, bond, check, draft, judgment record or contract…the face of a judgment for which it was rendered.

74Black’s Law Dictionary 9th ed. (United States of America; Thomson Reuters, 2009) at 668 provides the following definition of the noun “face” as it relates to documents; “the inscribed side of a document, instrument, etc.”

DECISION

75On the face of the defendant’s bill of lading was the reference to Invoice number 140407. On the face of the said invoice was the value of the consignment, $263,520.00. Both can be said to be on the inscribed side of the document.

76I accept that I am to interpret statutes liberally and remedially. I am also to have regard to the intention of the Legislature. I find that, given the Regulation makes a carrier liable for the damage or loss of goods while in their possession, as noted above, the purpose of section 10 of Ontario Regulation 643/05 is to ensure that the carrier, in this case, the defendant, knows the financial risk he is taking by agreeing to provide carriage of the goods. If the risk is greater than a carrier can bear, he can decline the consignment.

77The onus is on the consignor, in this case, the plaintiff, to ensure that he makes a declaration of value of the face of the contract of carriage.

78I find that, by signing both bills of lading and specifically the defendant’s bill of lading, the plaintiff was adopting the contents of the contract of carriage and any declarations therein can be considered to be made by the plaintiff.

79I find that, having already determined that invoice number 140407 is part of the contract of carriage, the value of the plaintiff’s property was set out on the face of the contract. On the face of the invoice is the value of the goods being the price the plaintiff paid for the goods.

80My conclusion is further grounded in the fact that the driver for the defendant made written reference to the invoice on the face of the Bill of lading that the parties signed.

81Such an interpretation meets the intent and purpose of section 10 of Regulation 643/05.

82As well, the practice of bundling the documents together or at least referencing the invoice on the face of the Bill of lading certainly was the practice of the defendant and likely the practice in the industry.

83I find that the full value of the consignment, $263, 520.00, was declared by the plaintiff on the face of the contract of carriage.

84There is no genuine issue requiring a trial as the entire case rests on this ruling.

85The plaintiff shall have judgment for $263,520.00 (less any amount already paid on behalf of the defendant, together with interest pursuant to the Courts of Justice Act.

86If the parties cannot agree on costs, written representations can be made to me of no more than three pages in length, together with a bill of costs within 21 days of the release of this ruling.